India’s industrial output growth dropped to a nine-month low of 1.2% in May 2025, dragged down by contractions in the mining and electricity sectors, according to official data released on Monday, June 30.

The mining sector saw a marginal decline of 0.1%, while electricity output shrank sharply by 5.8%, The Economic Times reported.

The slowdown in industrial activity comes amid a broader deceleration in industrial gross value added (GVA), which slipped to 6.1% in FY25 from 11.4% recorded in FY24. Official data for the first quarter of FY25 is expected to be released in August.

According to Aditi Nayar, chief economist at ICRA, the early onset of the monsoon curtailed mining activity and dampened electricity demand.

“The early onset of the monsoon doused activity in mining and the demand for electricity, amidst an anaemic growth of manufacturing,” Nayar said.

She noted that the subdued industrial volume growth observed in both April and May raises concerns for industrial GVA performance in the first quarter of FY26.

This follows the National Statistical Office’s earlier release of the Index of Industrial Production (IIP) figures, which showed India’s factory output had already slowed to a three-month low of 5% in April 2025, compared to 4.6% in April 2023.

Economists also pointed to a sluggish recovery in urban consumption and the seasonal effects of early monsoon rains as contributing factors to the industrial slowdown.

The data signals potential headwinds for the broader economy as it moves through the new fiscal year.